Weak iPhone sales hit shares of Apple's suppliers

An Apple iPhone 7 and the company logo are seen in this illustration picture taken in Bordeaux, France, February 1, 2017.Regis Duvignau

LONDON (Reuters) - Shares of U.S. and European suppliers of microchips, sensors and circuitry to Apple Inc fell on Wednesday, after the company's much-awaited iPhone sales missed expectations in its second quarter.

Suppliers rely on strong iPhone sales for part of their profits, and in some cases Apple's announcement on Tuesday reawakened concerns about excessive exposure to Apple.

Apple said on Tuesday it sold 50.76 million iPhones in the quarter ended April 1, down from 51.19 million a year earlier, indicating that customers may have held back purchases in anticipation of its 10th anniversary edition.

Analysts on average had estimated iPhone sales of 52.27 million, according to financial data and analytics firm FactSet.

Shares in Dialog Semiconductor, which provides power management systems for Apple, closed 2.5 percent lower, and was among the top European decliners on the day.

Dialog has been in investors' focus since mid-April when a research note from German broker Bankhaus Lampe suggested Apple could be developing the capacity to bring its power management components in-house.

That report knocked as much as a quarter off of Dialog's market value on the day. The company gets nearly 75 percent of its revenue from Apple, according to Morgan Stanley estimates.

Imagination Technologies, a British designer of graphical processing units used in smartphones, fell 3.3 percent. In April it said Apple, its largest customer, would stop using its technology within 15 to 24 months, causing its stock to lose nearly two thirds of its value in a single day.

Shares of Jabil Circuit Inc, a U.S. maker of casings for iPhones that gets nearly a quarter of its revenue from Apple, were down 1.5 percent at $28.78 in afternoon trading in New York.

Shares in ASML, Europe's largest supplier to computer chip makers, declined 0.4 percent. The Netherlands-listed company is lower down the Apple supply chain than Dialog and STMicro, supplying to Taiwan Semiconductor Manufacturing Company, which in turn serves Apple.

Reporting by Helen Reid in London and Anya George Tharakan in Bengaluru; Editing by Vikram Subhedar, Susan Thomas and Sai Sachin Ravikumar